Download

About Hilco Streambank

Hilco Streambank is a market leading advisory firm specializing in intellectual property disposition and valuation. Over the last three years Hilco Streambank has become a leader in the IP valuation and disposition market. Having completed numerous transactions including sales in publicly reported
Chapter 11 bankruptcy cases as well as private transactions, Hilco Streambank has established itself in the internet and telecom community as a responsible and effective intermediary in the space.

The Debtor has accepted an offer from Spin Master, Ltd to acquire the Marbles intellectual property and related assets for $2,500,000. The offer is subject to higher and better offers and Bankruptcy Court approval. Set forth below are the details and key dates for the sale process going forward:

Stalking Horse Bid: $2.5 Million

Minimum Overbid: $2.7 Million

Bid Deadline: Thursday, April 20, 2017 at 5:00PM CT

Auction Date: Monday, April 24, 2017 at 10:00AM CT

Sale Hearing: Wednesday, April 26, 2017 at 11:00AM CT

OPPORTUNITY

Hilco Streambank is currently seeking offers for the Marbles: The Brain Store® brand as a going concern or for the brand and related intellectual property assets (the “Assets”) including its trademarks, domain names, website, proprietary product designs, and customer database. The Assets are available for immediate deployment into a going concern operation that includes retail stores, e-commerce, and wholesale channels of distribution. The Company is currently operating as a Debtor under Chapter 11 in the United States Bankruptcy Court for the Northern District of Illinois.

BACKGROUND

Marbles is a developer, wholesaler and specialty retailer of games, puzzles, books, and software designed to strengthen and stimulate the brain. All of the Company’s products focus on developing or maintaining one or multiple cognitive functions including critical thinking, memory, coordination, visual perception, and word skills. As of December 2016, Marbles operated 40 retail locations across 13 states as well as pop-up locations during the holidays.

FINANCIAL OVERVIEW

In 2016, Marbles generated over $28 MM in total revenue from the following channels: Retail/Ecommerce/Wholesale. Additional opportunities exist in International sales, Institutional sales, and Brand and Product licensing.

Website and E-Commerce Platform

Product Related Domain Names Including:

MarblesBrain.com

MarblesGiftGuide.com

Flingons.com

SplicketyLitGame.com

MarblesGifts.com

MarblesPlay.com

EggHeadGame.com

SmartsAndCraftKits.com

and more

Retail

In 2016, the Company operated 40 retail stores generating revenues of $21,578,835. The retail stores provide a high touch interactive shopping experience and are a key outlet for product development and testing.

21 retail stores were profitable on a four-wall basis for the LTM as of December 2016.

Marbles Pop-Up and store-in-store locations generated sales of $1.9 MM in 2015 and $260K in 2016.

E-Commerce

Generated revenues of $3.27 MM in 2016.

1.43 MM unique visitors in 2016 up from 1.14 MM visitors in 2015.

Wholesale

Generated $2.4 MM in domestic wholesale sales in 2016 and project significant growth in the wholesale channel in 2017 with major retailers.

Opened wholesale and retail accounts in Australia and Europe, with opportunities in other territories as well.

Expansion Opportunities

Institutional partners such as the education systems, public museums, hospitals, day care centers, and camps are an untapped market for Marbles products.

Store-in-store and pop-up partnerships with major retailers across the globe.